“PL of Salary Equality” passes in Senate committees and will go to plenary

The bill christened by the federal government, author of the proposal, “PL of equal pay” was approved in three Senate committees this Wednesday (5/31) and will go to plenary in the coming days. The proposal, which had already been approved in the Chamber of Deputies last month, is being processed on an urgent basis at the request of the government.

The bill significantly increases fines in case of proven wage discrimination related to sex, race or ethnicity, in addition to including compensation for moral damages, and creates more obligations for companies. For economists, however, the measure would have the opposite effect, inhibiting the hiring of women due to the companies’ fear of labor complications.

Throughout the proceedings in the Chamber, deputies opposed to the proposal stated that possible negative impacts on women were considered by parliamentarians, who voted mostly in favor of the issue for fear of being seen as contrary to the rights of the female population.

Understand

The so-called “Equal Pay Bill” aims to ensure that there is no pay difference due to gender, race or ethnicity discrimination. Such a mechanism is already foreseen in the Consolidation of Labor Laws (CLT), the main Brazilian labor law. The proposal, however, seeks to increase fines in the event of proven salary discrepancies – in these cases, currently the labor legislation provides for payment of salary differences plus a fine of 50% of the benefit limit General Social Security System (R$ 3,753.74 in amounts current).

The new proposal provides, in addition to the payment of wage differences, a fine in the amount of ten times the highest salary paid by the employer. In addition, it establishes compensation for moral damages to be paid to the employee. Under the terms of the bill, companies with more than 20 employees must periodically publish the so-called “salary transparency reports”, which would be used to determine any salary discrepancies. If you fail to submit the report, the fine to the employer would be five times the highest salary paid by the company, increased by 50% in case of recurrence.

For sources heard by People’s Gazette (read here), the measure can have the opposite effect and generate economic losses to the female population. By increasing bureaucracy, possible liability and fines for hiring women, the determinations can lead companies to see hiring men as legally safer, which would discourage the formal admission of women, increasing unemployment and informality of the female population.